Brentwood, Tennessee Real Estate Trends in 2015, and a Peak at 2016

July was another big month for the Brentwood, Tennessee real estate market, and for Williamson County in general. Home prices in the area continue to climb as a result of high demand and population growth. These are some of the biggest trends we are tracking right now. Here’s a more in-depth look at the Brentwood real estate scene in 2015, along with an outlook for 2016.

The Williamson County Association of Realtors (WCAR) recently reported that the median home price in the county rose to $415,000 in July 2015. That’s an increase of 3.8% compared to the same time last year, and the eighth consecutive month where the median has remained above $400,000.

Demand for housing remains high as well, and this has contributed to the rise in house values. Last month, the number of real estate closings in the county rose by 7.8% compared to the same time last year.

There are several reasons for the high level of demand we are seeing right now. Economic gains, low mortgage rates, and the threat of rising home prices are bringing more buyers into the market — and giving them a sense of urgency. Consumer polls show that most people expect prices to rise through the end of this year and into 2016. So there’s a mindset among home buyers that it’s better to purchase sooner rather than later.

Inventory, meanwhile, remains tight in the Brentwood real estate market. As a result, homes are selling quickly and sometimes above the asking price. Limited inventory and high demand are putting upward pressure on home prices in Brentwood and elsewhere across Williamson County.

Chip Kerr, WCAR’s president, mentioned the inventory situation in the association’s latest report. “Inventory remains low for [Williamson] County as the housing market attempts to keep pace with demand,” he said.

Currently, there’s about a two-month supply of inventory in the county. Five to six months of supply is generally considered to be a “healthy” housing market. We are well below that. Buyers who are actively searching for a home in the Brentwood real estate market can probably attest to the inventory situation.

Right now, homes are selling faster and for higher prices than they have since before the market crashed. So in a sense, the market is even stronger now than it was during the housing boom years.

With all of that being said, there’s a general consensus among housing analysts that 2016 will be a slower year than 2015, at least where home prices are concerned. And perhaps this is to be expected. Whenever prices return to peak levels following a downturn, the rate of appreciation tends to slow.

Many housing economists expect the real estate market to continue progressing in 2016, but at a slower pace than what we’ve seen in the last couple of years. Earlier this year, Barron’s reported that: “housing experts, including Mark Zandi, chief economist at Moody’s Analytics, and Lawrence Yun, chief economist at NAR, see solid growth continuing, albeit at a more languid pace of 4% or so this year and next.”

Brentwood’s population continues to grow, and this is fueling the local housing market. According to the U.S. Census Bureau, the city’s population grew from 37,060 in 2010 to 40,021 in 2013. That’s an increase of 8% in just three years, and we’ve gained even more residents in the last couple of years. This creates a steady influx of home buyers, which helps sustain the demand side of the local real estate market. Combine that with limited inventory, and it’s easy to see why home prices have risen — and why they’re expected to continue rising into 2016.

If you want to stay informed about the Brentwood real estate market in 2015 and 2016, be sure to follow our blog. We publish market reports and housing news on a regular basis to keep you informed!